Answers
I want to open a home equity line of credit. I have 100% equity in my house and an excellent credit rating. I am planning on moving, but would like to buy another house first, and then sell my current house (which would sell for a higher price than the one I would buy).
If I use the equity line to buy a house, would the bank permit me to sell my current house and pay them off at the closing? Kind of a bridge loan without the fees.
I agree with Ibu Guru, I think you are making a big mistake, do not use a loan to get another loan, payoff the first house and save to purchase another, remember that the people who are being foreclosed are those that have mortgages.
"Quite simply, bank equity is not expensive from a social perspective, and high leverage is not required in order for banks to perform all ...
Does anyone know the typical point for a home equity line of credit ? By point, I mean the up-front fee that is proportional to the credit limit. So if the term asks for 5 points (5%) and the line of credit is $100,000, there is a $5,000 fee. Do you think that the numbers I've just mentioned are a pretty good deal, assuming that the interest rate is good? Thank you.
The minimum equity needed for a HELOC is 10% but it may be difficult to qualify for that and there will be fees on top of that. A typical HELOC requires you to have 25% equity/down-payment and ok credit (Your credit doesn't have to be perfect... If you applied for a credit card today, would you be approved? If yes, then your credit is good enough to qualify).
5% will only get you a typical mortgage.
Would a Home Equity Line of Credit or loan used to buy a home be considered a Home Aquisition Debt instead of a Home Equity Debt?
For HELO interest on principal beyond $100k to be deductible, the proceeds must be plowed back into the property pledged as security. If it's used for any other purpose, the interest on the amount of the loan over $100k is non-deductible. To be considered as acquisition debt, the property acquired must be the security for the loan.
Home Equity Line of Credit
I was able to get one at the DVA Federal credit union, but you have to live or work in Washington DC to belong to that credit union.
Brother initially borrowed $92, 000 and then paid us paid the $92,000 plus interest of $8,000 that accrued on the loan to repay our equity loan of $100,000 during 2006. We received a 1098 Form for interest paid credit/deduction. Do we get to claim the $8,000 interest or does he?
You claim the deduction because the loan was against your home and the debit was in your name, the $8000 interest your brother paid was to the mortgage company not you so this is not interest income to you. You took a great risk, it's a good thing your brother is trustworthy.
How to Maintain an Equity Line of Credit
You can use any asset you own to create an equity line of credit. For a personal line, a home is the most common asset used. Businesses also obtain equity lines of credit based on their commercial assets. Your loan will be distributed in a sum dependent on the size of this asset. Most loans will be distributed as less than the value of the asset, though some loans can be over 100% of the value. Once you have your line open, you can begin using your credit, spending up to the limit at any given point. You will be required to make minimum monthly payments. These payments are low; however, you should pay down your balance to avoid compounding interest charges. Even if you cannot pay down your balance, the most important thing is to never miss the monthly payment. Missing this payment will lead to a credit score decrease, extra charges, and the possible loss of your credit line.
News
Home equity lines in the line of fireExaminer.com - Dec 29, 2009
For those of you with a Home Equity Line of Credit (HELOC) this is an opportune moment to create a strategy about how to handle it.CNNMoney.com (press release) - Dec 29, 2009
LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 714 $ 1770 Accrued liabilities 1194 1529 Line of credit 1000 1000 Capital and more »UPI.com - Dec 30, 2009
Homeowners didn't ask for their equity to deteriorate. They didn't ask to be laid off from their jobs. Now, economists say, the trick is to wait for prices and more »
Business Mirror - Dec 30, 2009
The deal between AgriNuture and GEM provides for “an Equity Line of Credit Agreement” under which “the Subscriber agreed to subscribe for, and more »Microfinance Focus - Dec 30, 2009
In another similar development, around 30 microfinance lenders jointly took a 5% equity interest in High Mark Credit Information Services Pvt. Ltd, and more »
Subprime Blogger (blog) - Dec 21, 2009
By buying a credit report you will see every line of credit that is currently reported on you. Make sure that all of these lines of credit are 100% accurate and more »Sacramento Bee - Dec 30, 2009
"We're a national credit tenant, which means we pay our bills," Chabris said. 7-Eleven has been lying low for years, said Bill Coyle, managing director of and more »